Host:
Good day, everyone, and welcome to the ParkerVision, Inc. second quarter
2010 conference call and webcast. Today's conference is being recorded, and all
listeners are in listen‑only mode. Following the presentation, we'll open
up the conferences for question and answers. The company has requested that
question and answers are limited to one question and one follow‑up per
caller.

As
it is now time for opening remarks and introductions, I'd like to turn the call
over to Mr. Ron Stabiner with the Wall Street Group. Please go ahead, sir.

Ron Stabiner:
Thank you. Good afternoon and thank you for joining us. Before we get
started, I would like to remind listeners that this conference call will
contain forward‑looking statements which involve known and unknown risks
and uncertainties about our business, the economy, and other factors that may
cause actual results to differ materially from our expected achievements and
anticipated results. Included in these factors is the ability to maintain
technological advantages in the marketplace, the ability to increase manufacturing
capacity to meet demands, achieving timely market introduction and acceptance
of product, maintaining our patent protection, and the availability of capital,
among others.

Given
these uncertainties and other factors for our business, listeners are cautioned
not to place undue reliance on any forward‑looking statement contained
within this conference call. Additional materials concerning these and other
risk factors can be found in our filings with the Securities and Exchange
Commission.

On
today's call we will hear first from Cindy Poehlman, chief financial officer of
ParkerVision, who will provide a review of the company's second‑quarter
and six‑month results, followed by Jeff Parker Parker, chief executive
officer, who will provide an update on the business of the company.

With
that, I will now turn the call over to Cindy. Please go ahead, Cindy.

[1:49]

Cindy Poehlman:
Thanks, Ron, and thank you to those of you joining us for our second
quarter 2010 conference call. We reported today a $3.8 million, or $0.09 per
share, net loss for the second quarter of 2010. This compares to a $7.7
million, or $0.19 per share, net loss for the same quarter last year. Operating
expenses for the second quarter were approximately $3.8 million, which is 34%
less than the $5.8 million in operating expenses for the second quarter of
2009.

Most
of the reduction in operating expenses is a result of reduced spending in
research and development, particularly in the area of outside design resources.
These reductions are a result of the completion of certain development programs
late last year coupled with the deferral of certain programs as we have
narrowed our focus.

In
addition, equity‑based compensation expense for the current quarter was
down nearly $600,000 from the same quarter last year as a result of the
completion of vesting on certain prior‑year awards coupled with a
reduction in the overall number and magnitude of new equity‑based awards
granted in recent periods.

For
the six‑month period ending June 30, 2010, we reported a net loss of $7.7
million, or $0.19 per share, compared to $10.9 million, or $0.35 cents per
share, for the first half of 2009. Again, the reduction in net loss is
attributable to the nearly 30% reduction in operating expenses from 2009 to
2010.

We
ended our second quarter with approximately $7.7 million in cash and short‑term
securities. Our average cash usage for operations in 2010 was approximately
$2.7 million a quarter for the first half, which is a reduction of 18% from the
$3.3 million per‑quarter average operating cash usage in the first half
of 2009.

What
you can take away from these financial results is that we continue to maintain
a tight rein on our operating costs. We are able to do so by maintaining a
narrow focus on our primary short‑term goal, which is to assist our
industry partners in launching the first 3G handsets with D2P technology.

With
that, I'll turn things over to our CEO, Jeff Parker, for a brief update. Jeff?

[3:57]

Jeff Parker Parker: Thanks, Cindy, and thanks to you folks for
joining us on this call. Our last update was just a short while ago, and I
thought today that we could focus on some of the questions that I've heard
since that last call and hopefully provide some additional clarity in a few
areas. But before I get to that, I want to briefly discuss our announcement
that we made earlier today regarding the delivery of a low power consumption RF
transmit solution to the U.S. Army that we made along with our partner, ITT.

As
you might recall, earlier this year we were working as a subcontractor for ITT
under a contract with an organization called CERDEC, which is the acronym for
the Communications‑Electronics Research, Development, and Engineering
Center for the United States Army?

The
purpose of this was to provide CERDEC with a D2P prototype that demonstrates
our technology in an existing radio transceiver that's an ITT platform. And
that showcases our multimode capability and the low power consumption that we
are able to achieve.

We
fulfilled our contract obligations by retrofitting ITT's platform using our
existing commercial D2P chips, and as our announcement indicates, the transmit
solution was delivered successfully to CERDEC, who was then able to verify
independently in their own lab the benefits of the D2P technology.

While
we're certainly very pleased with that, our immediate focus is on the
commercialization of our cell phone product with our baseband partner in 3G
mobile handsets. We took a big step forward toward accomplishing that goal a
couple of weeks ago when we announced our first handset design win and our
baseband partner's commitment to facilitate the procurement process by agreeing
to the terms and conditions of an initial blanket purchase order for up to a
million RF chipsets.

I
want to spend a few minutes discussing with you what this design win means for
our company, ParkerVision, what role the sample phones have played in this
process and a little bit about the next steps that we'll be going through in
order to launch product. I want to speak for a little bit about why we're so
confident that this is leading to the start of a strong product‑revenue
stream and sales ramp for ParkerVision.

First
let's start with what do we mean when we say we've secured a 3G design win?
What we mean is that a brand name handset OEM, who's a significant customer of
our baseband partner, has selected a 3G handset model that is shipping in high
volume ‑ this is a newer model ‑ and they're designing the
ParkerVision chip which is used with our baseband partner's chipset into this
particular phone.

This
design-in process is the same for any component that you see in the
marketplace. This isn't unique to ParkerVision. This process is basically
comprised of a few key steps: first, supporting the handset OEM in the design
process. Secondly, verifying the component performance for the first production
handsets. Third, the placement of an order, which in our case will come through
the baseband company. And fourth and certainly not least, the production ramp -
which in our case includes where we provide silicon to our manufacturing
partner who does the packaging, the testing, coordinates the inventory and
distribution, which, by the way, they do for literally hundreds of millions of
components today that flow through their manufacturing facilities.

Some
of you asked for a little more granularity on these steps. So let me take just
a couple minutes and elaborate. The design-in process starts the beginning of a
commitment, because it includes the allocation of very valuable resources on
the part of the handset OEM.

They
start with a program manager and a team, and that team has been engaged in
working with our design team as well as our baseband partner, so that they can
formalize a production design for the handset. Once that design is complete,
then they will build enough units to verify that the specs are met over a
reasonable statistical sample. Typically, that's several hundred units.

We're
extremely confident that our production units are going to provide all the
benefits that we've cited. And in fact, I believe this initial run will
demonstrate additional benefits that are inherent in our product and that I
think everyone will be excited about.

Today
when they use a legacy RF design, the handset manufacturer has to deal with the
stack‑up of the tolerances between a separate RF transmitter, separate
filter, and a separate RF power amp. But with our product, all of those
separate components are eliminated in favor of a single chip delivered ready
for production.

There's
no question this is going to improve their manufacturing experience, and I
anticipate very positive feedback around these additional benefits. The reason
for our high level of confidence is that we've already built sample handsets
which use our technology and have been tested and verified by our baseband
partner.

You
might be asking yourself, "OK, so why does the handset OEM have a separate
verification step? Why can't they just use the test results from the sample
phones?" The answer is that the sample phones are really a sales tool that
are used by our baseband partner to prove that the technology benefits happen
in a working handset, not just on a test bench.

However,
the design of those sample handsets is not identical to the design that's being
implemented by this first OEM customer. If you look at a handset company, some
of their competitive advantage is in the intellectual property of their own
approach to building handsets.

Any
time you're producing handsets in the millions or the tens of millions of
units, you're going to want to make certain that you have tested samples that
are in the exact same configuration as your final product. It's really their
brand with our chip inside that matter to them the most.

This
verification step is true of any component in any handset that's developed. But
it's especially important in the area of RF, which is still one of the more
complex design portions of an overall handset design.

So,
what's great is that the 3G handset for this design win is for an existing
newer‑model cell phone and that this is already shipping today. We've
removed the existing RF. We've replaced that with our own RF chip to create
this new D2P‑based design that extends the battery life of this handset
by up to 60% and does so at a competitive price.

So,
our successful implementation in the sample handsets, along with the fact that
the non‑RF portion of this handset is already in production, gives us a
very high level of confidence that these first production handsets for this
design win will enable the OEM to check the verification box pretty quick.

When
that happens, we anticipate that the handset OEM is then going to place the
order with our baseband partner. As you may recall from our recent update, when
that occurs, our baseband partner has committed to place an initial one million‑unit
blanket purchase order with us and schedule an initial release for delivery.

Now,
I want to spend just a moment talking about the significance of what we've
accomplished to date with our technology. I think it's great to go through the
steps that we just went through, but I also want to just take a minute to help
you understand a little bit about where I think this takes ParkerVision not
just short term, but even longer term.

This
mobile handset space, no question, it's a difficult market to break into.
Especially when you're a new, smaller innovator of a disruptive RF
architecture. It's a difficult space to find partners who are willing to place
their own reputations on the line for a yet‑uncommercialized, albeit
promising, alternative - despite the fact that our technology solves issues
that their customers are actively seeking to resolve.

The
fact that we now have those relationships and we have these agreements in place
to join a select, relatively small rank of viable suppliers in this space is
very significant.

Those
of you have continued to support us through this process, I believe and I hope
you've done it because you understand that once we reach this point of becoming
a viable supplier in this space, realize that we really are going to have the
opportunity to enjoy a very rare growth opportunity. There are not markets of
this size and potential that you see everywhere. It's pretty limited.

Look,
we're not ready to uncork the champagne bottle just yet and say, "Hey,
we've commercialized the technology," although I think we're getting
pretty close. But I definitely think it's important to take note of just how
far we've come and to recognize the threshold that we're currently standing on.

More
importantly for you, I think it's important to realize that although this is a
difficult industry to break into, that once we're in, once we've gotten that
foot in the door and we become known as a viable supplier, that the growth
potential is truly enormous.

I
firmly believe that our current laser focus on a successful product launch with
this first 3G handset OEM will absolutely open up the floodgates to more
opportunities in both additional audiences for our initial product as well as
our broader technologies.

I'd
like to spend maybe just another minute on what we see the financial
opportunities are for our technologies short term, mid‑term, and even
longer term. I think the easiest way to do that is to look first at the
potential of our initial products with its first customer. Secondly; the
potential within the customer base of our current baseband partner. And then
lastly, the potential within the overall mobile handset industry.

Based
on the feedback that we've gotten from the handset OEM, I believe they will
initially incorporate our chipsets in a few million of their 3G handsets to
start with. That's our beginning point.

I
believe we have expansion and growth opportunities for our products with this
initial handset OEM, and furthermore, if you look at the expansion of this
offering within our baseband partner's broader customer base, we believe that
our opportunity increases by about 10 times this initial handset OEM's volume.

Now,
an expansion of this product line to include additional bands of RF coverage,
which we plan for next year and there are additional processors that our
baseband partner is coming out with will expand our opportunities with those
customers even further.

With
our current baseband partner and the current product, we see the potential to
ship RF chips in the tens of millions of units annually. From there, we see
truly exhaustive possibilities to explore, including products that incorporate
other standards that are both existing standards and future standards.

Ultimately,
our market opportunity is, in the handset space alone, represented by the over
one billion handsets that are shipped annually - so certainly an extremely
large market potential for us.

So
not only does a successful launch open up, really, almost endless possibilities
for product and revenue growth for ParkerVision, but it also is going to open
up financing opportunities for us. Obviously, we will have capital needs in
order to fund our operations until we achieve a level of cash flow that exceeds
our operating expenses, albeit, as you heard earlier, I think we're doing a
really good job of keeping a lid on those expenses.

We're
exploring numerous opportunities, and as I stated on the last call, we're able
to now explore opportunities that heretofore were not available to us. The
timing of our first order, the rate of uptake of products that incorporate our
chips, the fundamentals in our baseband partner and their customers are all
going to factor into our financing discussion.

So,
while I'm not ready today to give you a definitive answer regarding our future
sources of capital. I want to assure you that while it's a priority for the
management team to not only obtain and make sure we're properly capitalized,
but to do so in a manner that is a non‑dilutive as possible to our
shareholders.

That's
certainly a concern, I know, of mine just as well as many of you, so we're
going to be very thoughtful about this. But I tell you as this company proves
it can commercialize its technology, there are going to be doors open to us
that were not open before.

I
appreciate those of you that have been supporting our effort. We're certainly
approaching some extremely exciting times in the near term ahead of this
company. Now I think, operator, I'd like to go ahead and open the call for
questions.

Operator:
Thank you, sir. The question‑and‑answer session will be
conducted electronically. If you'd like to ask a question, please do so by
pressing the * key followed by the digit one on your touch‑tone
telephone. If you're using a speakerphone, please make sure your mute function
is turned off to allow your signal to reach our equipment. Again, that's *1 on
your touch‑tone telephone at this time to ask a question. We'll pause
just a moment.

We'll
take our first question from Matthew Pavich with Presidential Brokerage.

[18:42]

Matthew Pavich:
Hi, Jeff. A couple of quick questions. One: I've been in the stock for
about five years now, and when I first got into this stock the catchphrase of
disruptive technology was used quite often. I'm not really up on the technology
across the arena in the industry. Is it safe to say that this is still
considered a disruptive technology? Two: I looked at the stock price over the
last several years, and I think part of the problem from my take has been that the
company's been optimistic about what was coming down the pipe. Is there a
reason for me to believe that that's not going to happen anymore?

Jeff Parker:
Those are two good questions. Thank you. Let's take them in the order you
offered them up. Yes, I'd still look at our technology as a disruptive
technology. There have been a number of attempts to advance the RF portion of a
wireless product that we're advancing, the transmit technology, although it
will also receives. So that it can be much more power efficient and
simultaneously also be very agile in terms of the kind of signal it can
transmit. But, to date there hasn't been anybody who's emerged with a solution
that can be commercialized. There have been some interesting ideas, but there
have been a lot of good reasons why those ideas had shortcomings that prevented
them from really going the whole distance.

I
believed in the beginning, from when our team presented the idea that this
technology had the absolute foundation that would get it to commercial success ‑
now it's going to segue into your second question ‑ albeit it's taken us
longer than I anticipated.

On
the one hand, there's no question that it's taken us longer than I had hoped
for. And on the other hand, what keeps me going and enthusiastic is what we
said the technology would do and the benefits it would deliver it absolutely
does.

It's
been frustrating that it's taken us longer, but it's been darned encouraging
that the technology does have that disruptive edge to it, because it does the
benefits that we said that it does, and candidly there are other things that
the technology can do going forward I'm not going to spend the time on the call
to talk about. But a really, truly disruptive technology, you start out using
it for one particular reason, and as you go down the path you start to see
other things that it can do and maybe even other market opportunities that
could be even larger than the one you originally targeted. I definitely see
that in this technology.

In
terms of going forward, I guess this will be my last answer to your questions;
we're definitely trying to be as realistic as we possibly can. I think the
farther away you are from a commercial launch, the easier it is to be off in
your estimate, no matter how much you believe it.

Now
that we're so close, we've gone through so many of the steps we're literally at
the threshold, the door of the production launch. We'll try to be as thoughtful
as possible going forward not to over‑commit, and we'll try as much as we
can to actually under‑commit and over‑deliver. Thank you for being
a shareholder for the last five years. Greatly appreciate it.

Matthew:
Thanks, Jeff.

Operator:
We'll take our next question from Phillip Anderson with Pinnacle Fund.

[22:35]

Phillip Anderson:
Hey, Jeff. How are you today?

Jeff Parker:
Hi, Phil. Good afternoon.

Phillip Anderson: Since I was typing pretty quickly, I just want to
ask you to fill in a couple holes. What was the improvement in talk time that
you mentioned? Was it 60%?

Jeff Parker:
It's up to about 60%, Phil.

Phillip Anderson: What causes it to be up to 60%? In other words,
can you help us understand what might cause it to be 40%?

Jeff Parker:
Right, that's a good question. When we say up to 60%, where you're
located in the relationship to the base station determines how much power is
needed to reach the handset to the base station. There are a lot of statistics
that people have gathered to create what they view as the average user. The
average user's a little bit like if you took 10 people and put them in a room
and measured their height, nobody would exactly come to the average height.

But
we've not only looked at a lot of those statistics, we've actually done a lot
of the testing ourselves in the field and come up with statistics that
correlate with a lot of the usage that we see. If you were sitting right under
a base station, if you parked your car under a base station, you'd have not
much signal that it would take to reach the base station. You wouldn't get 60%
because the power level's very low.

But
if you're in that in‑between, you're not under the base station and
you're not on the fringe but you're in between those two ‑ that doesn't
necessarily have to mean, by the way, in distance, you can just be inside of a
building where you've got walls that attenuate the signal. There are all kinds
of things that attenuate the signal strength of a radio signal.

So
you're not at full power, and you're not at minimum power. You're in between
the two. That's where we see the up to 60%. We believe from the statistics that
we've seen and what we've measured that that 50, 60% improvement is going to be
seen by quite a bit of the usage from the way a handset's typically operated.

Phillip Anderson: When the cellular OEM evaluates the phones, will
they see that savings or improvement themselves during their testing?

Jeff Parker:
Yes, they will. What they'll do is they'll actually run the phone
attached to base station simulators. And they'll crank it up and down the power
level. They'll record those power‑consuming numbers, and they'll compare
that to the phone with the existing technology. I've already seen that, by the
way I've already measured the phone with the existing technology. I know
exactly what the numbers are. If you compare that to the sample phones we did
last year, and that's what they get out of this, which is what's going to
happen, they're going to be extremely happy.

Phillip Anderson: Is there anything of interest or concern on the
platform on the customer's phone versus the technology that was in our sample
phone that might have an impact on the increase in talk time?

Jeff Parker:
Not that I know of, no. What's nice is that this phone is in production,
and so the only thing that's being changed out is just the RF portion, nothing
else. There's nothing else that I'm aware of that would...

Phillip Anderson: In that same breath in your prepared remarks you
mentioned the cost savings, too. Can you help us understand what the cost
savings...

Jeff Parker:
All I really said in my remark is that it's at a competitive cost. I'd
like to keep it at that comment right now.

Phillip Anderson: OK. As you may know, Jeff, short sellers have
targeted the company and the stock from time to time.

Jeff Parker:
No.

Phillip Anderson: One of the things that they say is that the
technology doesn't exist, because if it existed and performed in the manner the
company says it does, then you would have left behind technology for
prospective customers to evaluate. Some of these shorts believe that you have
the [inaudible 26:40] relationships to have a chance to access it or at least
talk to somebody who's evaluated it. If you were talking to a short seller who
made that allegation, how would you respond to that?

Jeff Parker:
Let me make sure I understand the question. If the question is have we
left technology so that companies or individuals within companies can measure,
test, use our technology without us being there, independent of us, the answer
is not only have we, but there still are. There are a number of them. Our
baseband partner has our technology and has for quite a while. ITT has our
technology. CERDEC, the military, has our technology. There are other
companies, though some of them I can't mention, that have our technology.

So,
I don't know where this misnomer comes from, but the fact is people have our
technology. They've had our technology. In every case I can think of, leaving
the technology and letting people play with it and use it and test it without
us looking over their shoulder, which is the right way to do it, is generating
more enthusiasm to use the technology, not less enthusiasm.

Phillip Anderson: I would certainly think so. Either it works, or it
doesn't.

Jeff Parker:
Phil, that's exactly right.

Phillip Anderson: One last question, then. I appreciate the time.
You mentioned some product line extensions next year and didn't want to get
into it, but could you give us one thing maybe on the front burner that might
apply to the cellular OEM market in particular?

Jeff Parker:
Sure. One of the first things you'll see us do is we're going to add some
more frequency bands to this first product, which will give you more
geographical coverage that it can be sold into. That's a relatively
straightforward path, so that's the first thing we're going to do. The other
thing is our baseband partner has been expanding their own product line. I'm
not really at liberty to go into details of that, but they've got some more
basebands coming out that we attach right to. That, just by the very nature of
their product line growth, which will increase their unit shipment as well, is
going to give us more growth opportunity. Those two things are in the offing
for next year.

Phillip Anderson: It all sounds great. It sounds like you're making
great progress. We've very encouraged and getting excited. Thanks very much.

Jeff Parker:
Thanks, Phil. I appreciate your questions.

Operator:
We'll take our next question from Wilson Jaeggli with Southwell Partners.

[29:12]

Wilson Jaeggli:
Thank you. Jeff, to follow up there on Phil a little bit, you mentioned
the four steps you need to go through here, the first one being to support the
OEM with the design in, which has been completed, and the verifying of the
performance right now, I would guess. Can you add anything to that? Can you
tell us where we might be in that verification process?

Jeff Parker:
I'd rather not. Wilson, the most granularity I want to give right now is
that the baseband company and the handset guys and our company, we're all
targeting to work together so that we can start this launch of the production
ramp before the end of the year. So between the design in, the verification,
and the order, I really don't want to dissect where we are with that. They
prefer I not, and I know it's going to invite some other things. I think it
would probably be best just to give you guys, "Hey, we got to the end
result, and now we're off to the next steps."

I
can only say to you that this is not going to take huge amounts of time. We're
going to get it done in the near future, and believe me, as soon as it's to
that, check the box, here's your order of [inaudible 30:32] , I'll be the first
one to come and tell you guys. It will be a great milestone for us, and I am
very confident we're going to hit that milestone.

Wilson:
The second thing is this ITT. Correct me if I'm wrong, it seems to me we
have another party, a completely independent party, verifying our technology.
Did I understand you to say we basically use a commercial chip in the ITT
platform?

Jeff Parker:
Yes. What the ITT customer, the U.S. military communication arm, said
was, "Hey, why don't you guys help us verify your technology by taking
some of your commercial chips. And can you interface those to an ITT
transceiver platform that we're already using and let us go off in our own labs
with our own tests, run some tests, verify some things? If those things verify,
then we can go off and start to work on how we could incorporate this in the
products and sponsor the cost of that, etc." So you are correct. We took
some of our commercial chips and we put them into this ITT transceiver
platform, and that was delivered to the military. We basically showed them how
to operate the equipment in their lab and left it with them. They have it. It's
theirs to keep. They’ve reflected back to us extremely positive things and
their enthusiasm for pursuing products with that now.

Wilson:
Basically, we have had ITT verify the design; we have had the Department
of the Army's purchasing arm, I guess, or design arm verify the design; and
we've also had our baseband partner verify the design. Is that correct?

Jeff Parker:
That is correct.

Wilson:
So we're waiting for number four here, which is our OEM.

Jeff Parker:
That's correct, although I also don't mind telling you that we've left
this with a couple other companies who have verified the design as well.

Wilson:
We anxiously await. Make it work, Jeff.

Jeff Parker:
We're going to make it work, Wilson. Thanks.

Wilson:
I have confidence in you. Thank you.

Operator:
We'll take our next question from Robert Cohen with Western
International.

[32:51]

Robert Cohen:
Hi, Jeff.

Jeff Parker:
Hi, Bob.

Robert Cohen:
Hi. My question is when you guys were making the decision on who you were
going to go with as your first cellular phone manufacturer, were you relying on
your partner to make the best decision for you on who they thought would be
best, or was it a joint decision?

Jeff Parker:
It was a discussion, but, ultimately, I am really taking the lead of the
senior management of our baseband partner. Because they have now had so much
experience in successful design win after successful design win after
successful design win over a number of years that they said, "Look, we
know our customer base, and we know who will be the best first partner for
this, who will be the best second, third, etc." We certainly had a
discussion around it, but my view was let's go with the leadership guidance of
the baseband senior management team. They've done this before, and they are
going to put their best effort forth because they have a vested interest just
like we do. It gives them a nice differentiation to their product line.

That's
how it was done, and so far I have to tell you, Bob, everything that the
baseband partner has told me would happen in this design win process for this
customer is exactly what happened.

Robert Cohen:
I've got a few more questions, but to follow to this, could you have gone
with a lesser company and been through this process by now, or did you make the
decision that this was, as you said on the first call, a multi‑billion
dollar company, that this made the most sense even though it was going to take
longer?

Jeff Parker:
I don't know that it's taking any longer with this company than it would
have with a smaller company. I think that the design win process that these
guys follow is very typical from what I've been told and from what I've seen
when I look around. The other thing I guess I'll say to you is that one of the
things that we are very encouraged by with this particular handset OEM is they
have a really, really excellent product‑development team that we can work
very closely with, that we share guidance with, who collaborates freely with
us. It's a good cultural fit.

I
think what's really important for our first design win is that these phones not
only launch in a timely fashion but they launch with a result that we can
showcase to everybody else in the industry and say, "If you work with us
like this, you'll get the same result."

I'm
very pleased with the way this is going. I think it was, from what I can see,
an excellent choice, and I'm very pleased.

Robert Cohen:
Jeff, obviously, back in last October/November when you guys announced
that your partner did the test and it did better than anybody anticipated, in
the process you're doing now, where do you believe the biggest risk was? Was
the biggest risk the designs win, and is the commercialization basically a slam‑dunk
at this point? If you don't get the design win, you obviously don't go further.
But is that the biggest challenge is getting through the design win? Can you go
through that?

Jeff Parker:
I can tell you what the baseband folks said to me. They said the biggest challenge
you've got is getting the design win, because the resources of these handset
OEMs are so busy they are not easy to just willy‑nilly let them go off
and do anything. They're going to target what they think is going to bring them
value. Their view was that the toughest part is exactly what we've got now,
which is that design wins. Then from there, their view is it's really up to
ParkerVision to guide them through it, make sure it gets installed properly,
make sure it meets the specs that we've already told them we can meet based on
the sample phones, and then to get the production ramp to occur in a smooth
manner.

So,
yeah, at the beginning it's really that design win, just to get invited in,
because these guys cherish their resources. You can look back historically at
the handset market. If a handset OEM misses a cycle, it can really hurt them
badly with their market share as others continue to move forward.

This
is why these guys are very careful about where they assign their resources.
They're only going to assign resources where they think it's really important
and can bring them a competitive advantage. Otherwise, you're out of luck.
That's why it's hard to get into this market.

Robert Cohen:
So, if you go through the design win with them, do you believe in their
mind at this point they believe by using your chip in their existing phone
that's a newer phone, that they're going to get ‑ are they convinced at
this point they're going to get that 50, 60% extra talk time?

Jeff Parker:
Yes.

Robert Cohen:
Talking about what Phil Anderson said ‑ I hate even having to talk
about the short sellers, but they claim big deal, a million units. This million
units is not the end of the deal with them; this is just the initial order. Is
that how you would view that?

Jeff Parker:
That's exactly how I view it, just the first million units.

Robert Cohen:
I know you can. This is the last thing I want to ask, and it'd be great
if you can give us some kind of flavor on it and not tell us you want to
prolong this. Can you give us a minimum and a maximum? When you were doing this
before and you were going to get a royalty, people were out there saying he
might get $0.20 to $0.50 per chip. Now that it's no longer a royalty in the
deal you're in, can you give us what you think a minimum and eventually what a
maximum could be of what you can get per chip?

Jeff Parker:
In terms of the revenue per chip, Bob?

Robert Cohen:
Yes.

Jeff Parker:
Well, let me put it to you this way: by going to a chip sale instead of a
royalty, we've increased our top line, our revenue potential, certainly, by 10
times what our royalty revenue line would have been. Obviously, there's a bill
of materials in there now, so there's a margin we've got to be talking about.
But I've said in the past that the margin in this industry is 40%. If you're
good, you can get into the 40s, maybe 50%. I'd like not to see us get stuck in
the 30s. But if that helps you a little bit, that's the range.

Robert Cohen:
In your chip versus what's out there today, can we assume that your chip
isn't costing any more than what's out there today?

Jeff Parker:
Let's just say our price is competitive in the eyes of the handset OEM
and, from what I understand, of some of the other customers of our baseband
partner. We'll be definitely competitive in their eyes as well. I want to leave
it as a broad brush at this point.

Robert Cohen:
Thanks, Jeff. I appreciate it.

Jeff Parker:
By the way, for the folks who are listening, to me that's what are most
important, guys, is that we're a competitive solution. I mentioned in my
comments earlier today that there are going to be some manufacturing benefits
these guys are going to soon see. That's going to bring some value as well. If
your yield is higher, if you can help them with the velocity on the production
line, they can make more phones without adding more production lines. There are
all kinds of manufacturing benefits that we'll be quantifying, and we'll talk
about that in the future as we get farther down the road.

Any
other questions?

Operator:
We have no further questions in the queue at this time.

Jeff Parker:
OK. Well then at that note, I'm going to thank everybody for joining us
today. It was nice chatting with you in such a short time frame again, and I
look forward to bringing more exciting updates to you in the not‑too‑distant
future. Have a good rest of your week here. Thanks a lot. Bye‑bye.

Operator:
That concludes today's conference. If you wish to access archive audio
cast replay of this call, you may do so by visiting the company's website at
www.parkervision.com. Thank you and have a good day.